SWOT Analysis OF NIKE

drum Analysis OF NIKEPartial fulfillment by the award of the bit graduate diploma in business Management. From Fortune School of engine room and Management in Singapore.Nike Inc. was founded in1962 by Bill close in gay and Philip H. entitle as apartnership under thename, macabre instancewriter ribbon Sports.Since Germany conqueredthe domestic market place in America, Nike came with conf utilise-cost and senior in high spirits quality harvest-feasts for the Ameri derriere battalion. Today, Nike manufactures and distributes acrobatic shoes in the intercontinental market and 40% ofits gross sales come after from athletic decorate, sports equipment,and subsidiary ventures and they suffertraditionalas come upasnontraditionaldistributionchannelsinto a greater extentthan100countries orbicularly. Nike has deliver the goods a premier position in the market but in 1998, the company has to face the come to the fore of exploiting overseas workers and the altering consumer leads negatively pretentious the sales of Nike. In this report, I have discussed the case account statement of Nike that majorly covers the child laborproblem and the problem of change in consumers preferences subsequently which I have done the SWOT compend and have come up with strategic objectives, market driven scheme Objectives. Furthermore, the market dodging is discussed that covers the class strategy, targeting, positioning and channel distribution of Nike and the crop, price and promotional strategy it must approve.In theend, Ihave given s everal(prenominal)recommendations to Nikes focal point to force it towards success.ContentsINTRODUCTIONThe company Nike has establish its inciter with percentage of efforts today almost all knows about Nike it is a human historied blemish with a good reputation. Knight called his first shoe tiger and began allocation at path meet. Blue Ribbon in 1971 get its Swoosh and ennoble introduces the most important Nike brand line. In 1978 the Blue Ribbon becomes Nike and both years their earnings grow steadily. Due to Nike tutelage in informal shoes in the 1980, they missed the drawing to oxidative shoe and cut down after allowing Reebok to manage the marketplace.MISSION AND mental imageryNike states in its mission declaration that it entail responsibility commerce in a guilty way, most important to sustainable monetary increase. With the wage increase in knowledge, homo resource practices, the healthy knowledgeable and skilled physical exercise power, here is extremely small deficient to distinguish organization. Living be seen to go added than the final amount necessary on community issue dejection draw and keep patrons. This bottle sea green pass attracts concentration to the association they are view as thoughtful and universal liable (Mullins, L. 2005).A speech, on the construction put into practice of Nike during its absorb obtainable sequence accuse the association of individual concerned in limited operational circumstances, defiance of hard work civil flops, low salary and pestering of its labor force. Nike takes this information seriously. On the basis of the attainment answer the business has make stronger the check of its bundleer (Hummels, H and Timmer, D.2004) physical object OF THE STUDYProvide an environment which develops people to maximize their contribution to NIKE. recognize counseled consumer segment opportunities. Provide quality and modern services and mathematical products inbredly and externally Establish and nurture relevant emotional ties with consumer segments. Maximize profits.SWOT ANALYSISStrengthsNike is a real warring organization. Phil Knight (Founder and CEO) is frequently quoted as saying that Business is war without bullets. Nike has a healthy aversion of is competitors. At the Atlanta Olympics, Reebok went to the outlay of sponsoring the games. Nike did not. However Nike sponsored the top athletes and gained valuable reporting. Nike has no factories. It does not tie up cash in buildings and manufacturing workers. This makes a very be given organization. Nike is tough at research and ripening, as is evidenced by its evolving and advanced(a) product range. They then manufacture wherever they ordure produce high quality product at the lowest possible price. If prices rise, and products can be made more cheaply elsewhere (to the equal or improve specification), Nike get out move exertion. (ynkamat, 2009)Nike is a global brand. It is the act one sports brand in the World. Its famous Swoosh is instantly familiar, and Phil Knight withal has it tattooed on his ankle Nike is quite strong regarding its research and development quite pronounced regarding its evolving and innovative product choice.They manufacture high quality at the lowest potential price, if prices rise due to price hike then the production process is made cheaper by changing the place of production. It belongs to theFortune five hundred companies. Nike employs about more than 30.000 people worldwide.It has a strong sense of marketing promotion by sponsoring top athletes. It uses linarite foam and flies wire reals in order to make the manufactured shoes lighter and more convenient. (Adam, 2009)Its stand for high quality and innovative footgear .Nike is besides known for its innovative marketing .Nike ads are part of the pop culture an impressive achievement. noteworthy campaigns feature bo Jackson, Michael Jordon, and Tiger Woods the Nikes swoosh is highly recognizable world wide .Nikes recent comeback has been greatly helped by increased sales of Nikes apparel. (Robert N. Lussier, 2009)Political Analysis fit to PEST abbreviation the political enviourment can be taken as strengthThe government must pull in economical policies that will foster the growth of businesses. Nike, fortunately, has been helped by the US policies which alter it to advance its products. The support accorded to Nike by the US governme nt, particularly in the superior general macroeconomic stability, low interest rates, electrostatic currency conditions and the international fighting of the tax system, form the foundation critical to Nikes growth. (Cuizon, 2009)Society Analysis jibe to PEST abstract the social enviourment can be taken as strengthPeople are more health conscious currently. nutrition and health are getting more prominence. Consequently, more and more people are joining physical fitness clubs. in that location is an accompanying demand for fitness products particularly exercise apparel, shoes and equipment. Nike is at the front position of this soar upwards in demand as people are looking for sports shoes, apparel and equipment. (Cuizon, 2009)Technology Analysis Political Analysis According to PEST analysis the technological enviourment can be taken as strengthNike uses IT in its marketing information systems very effectively. Nike applies marketing information systems to the economics of im provement, segmentation and differentiation for nearly all of its businesses.Nikes leadership status owes in walloping part to the use of extremely valuable Information Technology, and applying it to every sen durationnt of the product from development to distribution.Nike, being the world leader in the athletic footwear effort, is able to effectively harness its environment to boost its marketing efforts. This strategy has trans new-maded into robust sales of Nikes products. (Cuizon, 2009)WeaknessesThe organization does have a alter range of sports products. However, the income of the business is still heavily dependent upon its take of the footwear market. This may leave it vulnerable if for any reason its market share erodes.The retail sector is very price sensitive. Nike does have its own retailer in Nike Town. However, most of its income is derived from selling into retailers. Retailers tend to offer a very similar experience to the consumer. Can you tell one sports retail er from some other? So margins tend to get squeezed as retailers try to pass some of the low price competition pressure onto Nike.Nike was for quite some time unwilling to disclose any type of information concerning its partnering companies. It was charged with the assault of overtime andminimum wagerates in Vietnam, 1996, that was seen as having unforesightful working conditions, and that it was also charged for exploiting cheap workforce overseas. (ynkamat, 2009)Nike was also inform to have applied child labor in Pakistan and Cambodia to produce association football balls. It was positioned as a subject of criticism by anti-globalization groups due to its frisky and exploited manner that was quite a disaster for its reputation. (Adam, 2009)In late 2005 founder phil knight re subscribe from the CEO position at Nike. Since that time Nike has had 2 CEO s. Nike brand co professorship mark parker is the companies new president and chief executive officer following the resignatio n of William D. Perez will Nike ever be able to replace the larger than life founder Phil knight? Another question on the area concerning is that global sales, such as Europe and Asia ,have instead at a much faster yard than domestic sales in the United States. (Robert N. Lussier, 2009)Economic Analysis According to PEST analysis the economic enviourment can be taken as weaknessIn economy, the biggest nemesis for Nike would be economic recession. During recession, Nikes growth will be adversely affected. The US economy is experiencing a downturn right now. Consumer purchases are slowing down. Currently, Nikes feeling the pinch of the economic recession. The Asian economic crisis also affects Nike since its goods are manufactured in Asia. The labor costs and material prices are going up.Nikes growth is not just affected by the local economy but also in the international economy. A weak Euro and an Asian recession could mean weak sales for Nike. The boilers suit results in the sale s generated by Nike in athletic footwear, however, remained stable. The global market makes up for the variances in sales particularly between peak and lean seasons. (Cuizon, 2009)Society Analysis According to PEST analysis the social enviourment can be taken as weaknessNike, however, failed to foresee problems brought about by a sweatshop expose pertaining to labor and factory conditions at production locations in Asia. This caused bad publicity and declining sales as society and consumersOpportunitiesProduct development offers Nike many opportunities. The brand is fiercely defended by its owners whom truly believe that Nike is not a fashion brand. However, like it or not, consumers that wear Nike product do not always bribe it to participate in sport. Some would cope that in youth culture especially, Nike is a fashion brand. This creates its own opportunities, since product could become unfashionable before it wears out i.e. consumers need to replace shoes.There is also the pro bability to develop products such as sport wear, sunglasses and jewellery. Such high value items do tend to have associated with them, high profits.The business could also be developed internationally, building upon its strong global brand recognition. There are many markets that have the disposable income to authorise on high value sports goods. For example, emerging markets such as mainland China and India have a new richer generation of consumers. There are also global marketing events that can be utilized to support the brand such as the World Cup (soccer) and The Olympics. (ynkamat, 2009)The brand is sternly defended by its owners who believe that Nike is not a fashion brand, however, a large number of consumers wear Nike product because they derive a fashiontrend kind of than to participate in a sport. It is mostly argued that in youth culture, Nike is a fashion brand which also createsopportunitiesfor Nike since its products would become outdated before even the product wea rs out i.e. consumers will feel the need to replace the product with a newertrend.There are many international regions that still need tapping and there is need for sportswear and with Nikes strong global brand recognition, it can initiate in many markets that have the disposable income to spend on high value sports goods.Nike gives a lot of effort on its bodily marketing mainly through thepromotion ofcorporate brandand sponsorship agreements. (Adam, 2009)Nike has an opportunity to capitalize on its own Nike Technology. This is a sensor placed in Nike footwear that interacts with Apples iPod to record the distance a runner has completed and the calories that have been burned. Another opportunity will be to capitalize on an imprimatur deal with LeBorn James after his NBA playoffs and championship series appearances. Additionally, Tiger timber yearly attempt to win all four major golf game Tourments automatically allows Nike to build product campaigns around the Tournaments. (Rober t N. Lussier, 2009)ThreatsNike is exposed to the international disposition of trade. It buys and sells in different currencies and so costs and margins are not stable over long periods of time. Such an exposure could mean that Nike may be manufacturing and/or selling at a loss. This is an issue that faces all global brands.The market for sports shoes and garments is very competitive. The model developed by Phil Knight in his Stamford Business School days (high value branded product manufactured at a low cost) is now commonly used and to an extent is no longer a basis for sustainable competitive advantage. Competitors are developing alternative brands to take away Nikes market share.As discussed above in weaknesses, the retail sector is becoming price competitive. This in the long run means that consumers are shopping around for a better deal. So if one store charges a price for a pair of sports shoes, the consumer could go to the store along the street to compare prices for the ex actly the same item, and buy the cheaper of the two. Such consumer price sensitivity is a potential external threat to Nike. (ynkamat, 2009)Consumers are constantly shopping around for a better deal that conveys a good quality and if one store charges a higher(prenominal) price for the products, the consumer would try to seek a better deal of the same product in the premises that delivers the same value but cheaper of the two, this type of price sensitivity among the consumers is a potential threat to Nike.The textile industry unpleasantly upsets the atmosphere, and therefore the organization is constantly struggling to retain its eco-friendly reputation. A recession may lead to job shortages in most of Nikes worldwide branches. The organization has experienced many adverse publicity feedbacks due to its far-flung advertisingIf you have a body, you are an athlete Bill Bower man said this couple of decades ago. The guy was right. It defines how he viewed the world, and it defines how Nike pursues its destiny. Ours is a row of sports, a universally understood lexicon of passion and competition. A lot has happened at Nike in the 30 years (Adam, 2009)Specific threat is the contracts that Reebok (now part of Adidas) signed with the NBA and NFL for its apparel businesses. Another threat is the ongoing public relationship s problem pertaining to working environments in the factories producing Nike sneakers. Nike has striven to overcome images of sweatshop conditions, but the problem has been strong to solve. (Robert N. Lussier, 2009)Porters five forcesSource(http//www.google.co.in/images?hl=enq=porters+5+diagramum=1ie=UTF8source=univei=8UhZTfaOCoXJrQfarcnuBwsa=Xoi=image_result_groupct=titleresnum=1ved=0CCIQsAQwAAbiw=1366bih=643)Potential EntrantsLowdicker power of buyersHighBargaining power of suppliersLowThreats of substitutesLowIndustries oppositionHighRefer to appendix 1CONCLUSIONSWOT analysis should always be measured by all companies as it helps evidence com panies all their weaknesses and threats. At the same time it also shows what the companies strengths and opportunities.Using this analysis companies can spotlight on their good part of the business and focus more on the bad part to make it good. Also a company can see what factors are external or internal which helps the business in a long run to be more capableREFERENCESAdam, 2009. Nike SWOT Analysis. Online addressable at HYPERLINK http//www.mba-tutorials.com/marketing/240-nike-swot-analysis.html http//www.mba-tutorials.com/marketing/240-nike-swot-analysis.html Accessed February 2011.angeletti3, 2005. Nike versus Adidas crusade Study and emulous Analysis. Online Available at HYPERLINK http//www.echeat.com/essay.php?t=27606 http//www.echeat.com/essay.php?t=27606 Accessed February 2011.Cuizon, G., 2009. market Audit of Nikes Strategies. 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